Make some money

If you want to learn how to benefit from London's exciting property market, or how to spend the capital locked up in your home, then come to the Evening Standard Homebuyer Show at ExCel this weekend. There's something for everyone, including those looking to buy a property to rent to others.

More and more people are buying an "investment" property in this way, rather than relying on a pension. For some, it has become an integral part of their personal financial plans.

Buy-to-let has paid off for people who bought over the past four years. Rising house prices and steady rents have more than doubled returns. The climate is different today, but there are still opportunities for smart investors.

Perhaps the main attraction of buytolet is that it can be self-financing. The theory is that the rent covers the monthly repayments and other overheads at the same time as the property is increasing in value. You cash in your investment by selling.

"It's a case of borrow-to-let as much as buy-to-let," says David Humphries, managing director of Buy-to-Let.com, one of the main exhibitors at this year's Homebuyer Show. "Getting the right mortgage finance is the key to success."

His company offers a bespoke service to investors, selecting properties, finding tenants, arranging finance and even providing furniture packages. Humphries will be delivering the investment seminars at the show, showing how prospective buy-to-letters can enter the market.

New homes, especially apartments, remain the most popular buy-to-let purchases because they are low maintenance and have a design edge that appeals to a new breed of tenant.

Don't go over the top

Most investors are now keen to buy cheaper apartments, especially those in up-and-coming areas close to major employment zones, such as Docklands.

Fairview is pushing north Woolwich, where prices are 25 per cent cheaper than in nearby Isle of Dogs and half of those in central London. About £130 million is being invested in a two-mile stretch of riverside where Fairview is building Galleons Lock, 55 houses and 667 apartments, with prices starting at £149,000.

Normally, the lower the purchase price the higher the rental return.

Avoid the voids

So how do you go about getting the best return on a buy-to-let property? Basically, there are three main factors to consider: location, type of property and how well it is equipped and furnished. To succeed you have to cherry-pick.

In general, smaller and cheaper homes provide better "yields" than bigger, expensive ones, although they may not rise in value as much over the longer term.

Rents have dipped during the past six months, but yields of between six and eight per cent are achievable, which is still attractive in today's low interest-rate climate. Be wary of estate agents who quote above 10 per cent.

The greatest concern for investors is the amount of time a property can sit unoccupied. These "void" periods can sabotage the arithmetic, hence the importance of ensuring the property has tenant appeal. Parking is not necessarily an issue as many tenants will not own cars.

If you do buy new, make sure you get a good-quality specification rather than a trendy but low-grade interior. Having to do a design makeover in five years' time will eat into your profits.

As for location, consider transport links, the local economy, schools and amenities and try to envisage what will appeal to the tenant and any future buyer. Concierge developments with restaurants and leisure facilities are always a big draw.

Furnishing your property is an additional expense, though there is a demand for unfurnished lets. And sometimes furnished or unfurnished makes no difference to the rent you charge.

Usually, to entice a tenant, your property must have an edge. A well-presented apartment will let much more quickly than a run-of-the-mill one. There are decorative tricks, such as crisp colour schemes. Interior- design experts recommend stripped wooden floors rather than carpets. Bedrooms should have fitted wardrobes.